Petroneft raises $43m for Russian drilling

Petroneft Resources, the Russia-focused oil and gas explorer, raised $43m (£27m) to finance the development of two of its Russian fields.

The Aim-listed firm sold 63,125,000 new ordinary shares at 43p each to raise the cash. The firm said it will use the money to accelerate exploration and business development at its licences 61 and 67 at Tomsk Oblast in western Siberia, Russia. Petroneft holds 100 per cent of licence 61 and 50 per cent of licence 67.

The placing was “substantially oversubscribed”, the firm said.

Petroneft chief executive Dennis Francis said: “We are delighted with the outcome of the placing and the very high level of support received from both new and existing shareholders.”

He added: “The combination of year-round oil production and the continued development and exploration of licences 61 and 67, provides an excellent base from which we can generate significant cash flow.”

Petroneft added it is looking at other opportunities in Russia.

The firm also said it is on course to hit a year end production target of 4,000 barrels of oil per day and plans to treble this by the end of 2012.